Opinion

An open letter to marketers: it’s up to you to save the media industry now

Mainstream media is close to crisis point, with revenues drying up and quality content in shorter supply than ever. Mumbrella’s Alex Hayes argues it’s time for advertisers to take some responsibility for resolving the problem.

It turns out that AFR ‘World if fukt’ headline from a couple of years ago hit the nail on the head. At least for the media industry.

This accidental AFR headline sums up the feeling for the media at the moment

I’ll be honest, I’m deeply depressed with the ever increasing spiral of descent we’re stuck in at the moment.

I’m fed up of reading articles about job cuts in newsrooms, logging onto big news sites to find clickbaity headlines and pictures of the fucking Kardashians or some other Z-lister I’ve never heard of clogging up valuable homepage space, drowning out the important but less sexy stuff I actually need to know.

I used to be a news junky, but recently I’ve found myself dodging the mainstream sites as much as possible.

And you’re not being left out of this either TV.

Every night I turn on the box to find a bunch of vacuous and fame-hungry wannabes clogging up the free-to-air channels. Surely they must be close to running out of contestants for those bloody shows. 

Kiss Bang Love is the perfect example of TV’s race to the bottom

The problem is, they are all these companies can think to do to survive. The race to the bottom means catering for the lowest common denominator, at the expense of quality.

For news sites its the need to pull in as many clicks as possible, with CPMs in the toilet.

For TV networks there’s a bigger issue, it’s all they can actually afford to produce. When Ten was forced to move The Biggest Loser recently because of poor ratings it had nothing else to take its place, leading to repeats of Jamie Oliver cooking shows and Modern Family.

And when they do get a hit like Masterchef, My Kitchen Rules and The Voice they stuff it so full of ads it’s almost unwatchable for a normal person. Certainly without the aid of the live pause function to get at least 20 minutes into the show so you can rush through the ad breaks.

There’s an unspoken contract between the media and their audiences which is being fundamentally betrayed, which is why audiences are diminishing. The value proposition isn’t there, and the problem is those dwindling audiences mean they’ve not got the cash to do anything about it. And all the digital channels means there’s just a thinner spread of the shit now. 

One thing is for sure – no media organisation has any God-given right to exist. Decades of history, political influence or former glories do not give you a right to expect to be trading tomorrow.

In media, you’re only as good as the last thing you produced. Which is why many of our media giants should be very, very, afraid.

So if a lack of cash is creating these problems, what is the solution?

In the late 20th Century media organisations did a staggeringly good job of training the public to expect to get their product for free. The internet saw TV and news commoditised, and it’s no surprise today that the vast majority of people don’t have an inclination to pay to bypass paywalls or access Game of Thrones. It’s only a matter of clicks for them to find it somewhere else for free.

And this is where advertisers come in. They are the only way out of this death spiral for these media companies.

The problem is too many of you have been seduced by the promises of bargain basement media, choosing to serve millions of random impressions over thousands of targeted, quality impressions.

For publishers the promise of programmatic was to allow them to monetise long-tail content. But over the last few years they’ve been seduced and brow beaten into opening up all of their inventory to the exchanges, which has resulted in a blood bath. Once-premium spots are now sold for cents on the dollar, with a bunch of adtech middlemen pocketing the vast majority somewhere in the middle.

Programmatic middlemen are crowding the market between advertiser and publisher (Source: Mediascope)

It’s attractive for advertisers at the moment to use these tools. You can get many more impressions for the same, or even smaller, media spend. You’d be foolish not to right? And for media agencies the black boxes in the middle of the exchanges are a great way to pocket a few bucks too. And hey, machines mean we can cut actual people and save some cash? Winner, winner, chicken dinner.

TV’s challenge is subtly different.

People are turning off from the TV networks and onto subscription services like Stan and Netflix, where they can’t be served ads. The networks know this, but they don’t have the tools in their armoury to come up with their own Narcos, House of Cards or Stranger Things. Let’s be honest, House of Bond and the Shane Warne story aren’t really in the same league.

Sorry Warney, you’re not as interesting as the Lanisters…

But there’s a problem looming on the horizon, and it’s getting closer. There is a very real move to avoid ads online, and fewer eyeballs to view them on TV. Plus people’s trust in media, particularly online media, is dwindling because of the perceived lack of quality. It’s a death spiral and marketers are likely to be the unwitting victims.

So for you as advertisers it’s time to draw a line in the sand, and choose sides.

The erosion and declines in mainstream media are a bad thing for society, but they’re an even worse thing for you. Because when they’re gone, what’s left? Untrained bloggers, influencers and of course Facebook and Google. And with less competition come higher prices. And so the trap is set.

What’s my solution?

It’s simple. Ringfence a proportion of your budget and pledge it directly to a handful of media organisations to do something interesting and valuable with.

If publishers like Fairfax, The Guardian and News Corp had visibility of a good chunk of their ad spend for a year they could actually plan for the future, and focus on becoming sustainable businesses.

Rather than throwing all of your money into black box exchanges give it straight to the people who create the content, like you used to. See what smart and creative people can do when given the right resources. And display your brand proudly next to it.

For a first movers there’s a great campaign in it as well – and a lot of PR value to be wrung from being seen to support something valuable. And inevitably there would have to be lines in the sand about coverage of those companies to maintain some semblance of independence. But the media is so dependent now anyway I’d question how independent a vast swathe of it actually is already. 

There must also be a similar model waiting to happen with the FTA networks. Imagine the good will for Coles from underwriting the whole production of Masterchef allowing Ten to severely limit the amount of ad breaks in it.

There’s a million plus people each night who’d be grateful to have a 90 minute show mean 90 minutes of actual content. Not 45 minutes of cooking and a little while spent fast forwarding through the ads.

I reckon if you had the conversation you’d be surprised at how much your dollars could get you. And the amount of love you could buy from viewers.

Yes, I realise this is a utopian view of the world, but ultimately it’s a conversation that needs to be started in earnest now.

And of course, in this model it’s up to the media companies to start restoring the balance for consumers and advertisers by investing in quality content. 

If nothing happens how long will it be before there’s no Australian commercial media companies of note left?

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